STR 581 Week 6 Individual Strategic Plan and Presentation
1. Running head: STRATEGIC PLAN AND PRESENTATION - CB&I 1
Strategic Plan and Presentation - CB&I
Julie L. Bentley
STR/581
April 6, 2015
Kenneth Chapman
2. STRATEGIC PLAN AND PRESENTATION - CB&I 2
Strategic Plan and Presentation - CB&I
EXECUTIVE SUMMARY
Chicago Bridge & Iron
Horace E. Horton- Original Founder
Phillip Asherman, CEO, President
One CB&I Plaza
2103 Research Forest Drive
The Woodlands, Texas 77380
Telephone: 832-513-1000
Chicago Bridge & Iron (referred to from hereon in as the "Company") was established as a S
Corporation at One CB&I Plaza, 2103 Research Forest Drive, The Woodlands, Texas 77380
with the expectation of rapid expansion in the energy infrastructure industry.
GOAL INITIATIVE FOR STRATEGIC PLANNING:
The company wishes to change the strategic planning of this organization which already
includes: 1) operational excellence, 2) customer intimacy, 3) product leadership, 4)
differentiation, 5) focus, 6) concentrated growth, 7) product development, 8) innovation,
9) horizontal and vertical acquisitions, 10) concentric diversification, with a change to
include a new grand strategy of 11) conglomerate diversification.
Solicit financial backing in order to be able to introduce its products and services to new
global areas (described below).
Business Description:
The Company was formed on August, 1889 as an S Corporation under Illinois state laws
and headed by Horace E. Horton. Director of Development and introduction of Pratt-
Truss Bridge. Director and opening of first fabrication plant in Washington Heights, IL.
Product Development and Refinement of Energy Storage Tanks for water, petroleum, and
natural gas. Development of first automatic girth seam welder which improved weld
quality of storage tanks.
1889 - Establishment of Chicago Bridge and Iron
1889-Present - Operational Excellence, Customer Intimacy, and Product Leadership
1894 - First elevated steel plate water storage tank.
1923 - First floating roof tank for oil, natural gas, and petroleum.
1923- First Hortonsphere Pressure Vessel was designed and trademarked.
1930 - First Fractionating Towers were built for Standard Oil of Louisiana.
1959 - Development of Ornamental Water storage Tanks, Awards for global energy
storage devices used.
Currently – Global Energy Infrastructure Organization.
3. STRATEGIC PLAN AND PRESENTATION - CB&I 3
Acquisitions:
Howe-Baker International, L.L.C.
Shaw Group
Pitt-Des Moines, Inc.
John Brown Hydrocarbons, Limited
Fabrication shop in Beaumont, TX, which has deep water access to Gulf of Mexico.
Lummus Corp.
Catalytic Distillation Technologies (CDTECH)
E-gas solids gasification technology for conversion of coal and petroleum coke into
syngas.
1996- Praxair, Inc. merged with CB&I.
The Company currently employs 54,000 full-time employees and 4,868 part-time employees.
Management Team:
The Company has assembled an experienced management team:
President and Chief Executive Officer of CB&I - Philip K. Asherman, 35 years experience.
Executive Vice President and operating group President of Engineering, Construction and
Maintenance. - Patrick K. Mullen, 25 years experience.
Executive Vice President and operating group President of Technology - Daniel M.
McCarthy, 37 years experience.
Executive Vice President and operating group President of Fabrication Services - Luke V.
Scorsone, 34 years experience.
Vice President and operating group President of Environmental Solutions - E. Chip Ray, 30
years of global experience in operations, business development, strategic planning, mergers &
acquisitions, investor relations and marketing & communications. Prior to his current role, he
served as Executive Vice President, Corporate Planning from September 2007. Before joining
CB&I, he worked as Executive Director of Strategy and Marketing for Fluor Corporation.
Before joining Fluor, he spent 13 years with Nalco Chemical Company.
Executive Vice President and Chief Administration Officer - Beth A. Bailey, 39 years - in
1976 and has progressed through increasingly responsible roles in the IT organization. She was
named Vice President –Information Technology in March 1999.
Executive Vice President, Chief Legal Officer and Secretary - Richard E. Chandler, Jr., 30
years extensive experience in corporate law, mergers and acquisitions, antitrust and
international business transactions. Prior to joining CB&I, he served as Senior Vice President,
General Counsel and Corporate Secretary of Smith International, Inc. since 2005, where he was
responsible for developing and managing the company’s international legal strategy, including
the design and implementation of its legal compliance program. From 1986 to 2005, he served
as Vice President & General Counsel of M-I/SWACO, a leading supplier of engineered drilling
fluid systems and drilling waste management and environmental solutions.
4. STRATEGIC PLAN AND PRESENTATION - CB&I 4
Executive Vice President of Global Systems - James W. Sabin, 30 years of project execution
and information technology experience. Prior to his current role, Mr. Sabin served as Senior
Vice President of Global Systems and Senior President of Shaw’s Power Group. He previously
held several senior leadership positions with increasing levels of responsibility within Shaw.
Executive Vice President and Chief Financial Officer – Michael S. Taff, 30 years of financial
and global industry experience. He joins CB&I from Flowserve Corporation where he served as
Senior Vice President and Chief Financial Officer. He previously served as Senior Vice
President and Chief Financial Officer for McDermott International Inc., and also for The
Babcock and Wilcox Company following its spin-off from McDermott. Mr. Taff also has held
finance leadership roles at HMT, Inc., Philip Services Corporation and British Petroleum Oil
Company. He spent nine years in public accounting at Price Waterhouse, has a bachelor of
business administration degree in accounting from Stephen F. Austin State University and is a
certified public accountant. "Mike has extensive experience leading corporate financial
organizations. His breadth of knowledge, particularly within our industry, makes him an ideal
addition to CB&I's executive management team, and we are confident he will help the company
continue to drive shareholder value," said Philip K. Asherman, CB&I's President and Chief
Executive Officer.
Business Mission:
"CB&I is the most complete energy infrastructure focused company in the world and a major
provider of government services. With 125 years of experience and the expertise of
approximately 54,000 employees, CB&I provides reliable solutions while maintaining a
relentless focus on safety and an uncompromising standard of quality. As one of the most
complete providers of a wide range of services including design, engineering, construction,
fabrication, maintenance and environmental services, no project is too big for CB&I. Our timely
and cost-effective solutions not only satisfy our customers' needs, but also improve the quality of
life for people around the world" (cbi.com, 2015). The Mission Statement states: "Sustain
earnings (profit) growth at levels where stakeholders view CB&I as a "growth" company"
(cbi.com, 2015).
New Product/Services:
Conglomerate Diversification strategy change where acquisition of business or
competition would present the most promising investment opportunity available leading
to increase in CB&I’s stock value, acquirement of needed resources quickly, achievement
of tax savings 12-28%, increase in the efficiency and profitability of synergy between
CB&I and the acquired business.
After a period of thorough trial and error, the Company is prepared to introduce the
following product/services to the market – 4 new storage tank devices in Middle East and
current restructuring of water supply system and storage in Japan.
Energy Infrastructure Storage Tank-Petroleum, Natural Gas, Water: Includes
maintenance and environmental Services for new energy infrastructure projects.
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Demand for safe, uncompromising standard of quality, and improvement of quality of life
for people domestically and globally of energy infrastructure products with maintenance
and service contracts for continuous improvements of product and service.
1) Major Events Milestones for Implementation of new strategic management initiative:
The following event milestones will be used for evaluation of continued implementation of new
strategic management initiative of conglomerate diversification:
Event Department
Responsible
Date Due: Responsible Person
Contact
1. Beginning of
Strategic
Management
Change
Corporate and World
Headquarters:
Administration,
Executive Board,
Board of Trustees,
Governing Board
May 1, 2015 Phillip Asherman
James Sabin
Michael Taff
2. Implementation
Internally
Operating
Department –
Domestic and Global
June 30, 2015 Phillip Asherman
Patrick Mullen
Beth Bailey
Richard E. Chandler,
Jr.
James Sabin
Michael Taff
3. Measurement of
internal acceptance
to expand
externally
Operating
Department
Every 3 months
starting May 1,
2015, August 31,
2015, December 30,
2015.
Patrick Mullen,
Richard E. Chandler,
Jr.
James Sabin,
Michael Taff
4. Assessment of
Measurement
Controls
Finance and
Operation
Departments
Quarterly starting
May 1, 2015,
August 31, 2015,
December 30, 2015.
Michael Taff, James
Sabin, Patrick
Mullen, Beth Bailey,
5. Completion of
Strategic
Management -
Conglomerate
Diversification
Regional and
Corporate
Headquarters,
Operating
Department
December 31, 2015 Phillip Asherman,
James Sabin, Beth
Bailey, Richard E.
Chandler, Patrick
Mullen, Daniel
McCarthy, Luke
Scorsone, E. Chip
Ray
Michael Taff
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2) Event Milestones for new storage tank contracted projects:
Event Responsible Region
or Department
Date Due Contact Persons
Petroleum Storage
Tank in Dubai
Middle East Division
Corporate Operating
Office
December 31, 2016 James Sabin
Patrick Mullen
E. Chip Ray
Richard Chandler Jr.
Luke Scorsone
Daniel McCarthy
Beth Bailey
Michael Taff
Natural Gas Storage
and Piping in Arab
Emirates
Middle East Division
and Corporate
Operating Office
December 31, 2017 James Sabin
Patrick Mullen
E. Chip Ray
Richard Chandler Jr.
Luke Scorsone
Daniel McCarthy
Beth Bailey
Michael Taff
Water Storage Tank
in Egypt
Middle East Division
and Corporate
Operating Office
December 31, 2018 James Sabin
Patrick Mullen
E. Chip Ray
Richard Chandler Jr.
Luke Scorsone
Daniel McCarthy
Beth Bailey
Michael Taff
Water storage Tank in
Japan with piping
Asia Division and
Corporate Operating
Office
December 15, 2019 James Sabin
Patrick Mullen
E. Chip Ray
Richard Chandler Jr.
Luke Scorsone
Daniel McCarthy
Beth Bailey
Michael Taff
Upkeep maintenance
and service for Japan
Water Storage
Devices
Asia Division and
Corporate Operating
Office
December 31, 2019 James Sabin
Patrick Mullen
E. Chip Ray
Richard Chandler Jr.
Luke Scorsone
7. STRATEGIC PLAN AND PRESENTATION - CB&I 7
Daniel McCarthy
Beth Bailey
Michael Taff
Funding Request:
The Company requests a total loan of $2,000,000,000.00 over the course of 15 years, to be used
for the following purposes: 1) 4 projects - Middle East- Petroleum, Natural Gas, Water Storage
Facilities, and 2) Upkeep of Japanese water infrastructure since environmental weather disasters.
Purpose Loan Amount:
Staffing $8.4 million dollars
Equipment- $1 billion dollars
Contract Pricing- $10.5 million dollars
Business Law/Legal Regulatory Licensure fees - $2 million dollars
Logistical Transport- $12 million dollars
Long-term debt payment is a key feature of the Company's financial plan. We expect to
break even within an 8-12 year time period following the introduction of our products.
Financial predictions suggest a minimum 22.17% percent return on investment by the
conclusion of the financing period.
Business Goals and Objectives:
Short-Term Goals:
Continuous improvement of safety standards measured monthly for up to one year on
OSHA standards. Increase of 2-5% this year.
Procurement of 99% quality steel within 6 months of new projects initiated in May 2015.
Reduction of turnover rate of 3% for May 2015 - November 2015.
Increase in contract approvals of 5%.
Globally:
Decrease in delay of fabrication of steel for petroleum storage - Monthly 1-2%.
Decrease in transport time - 3% for next year.
Increase in cultural standards of care for environment social issues with building of
projects - 2-5%. Measured monthly at end of month and sent to corporate headquarters.
Increase in communication globally with project managers - 2-5% technology increase
(Skype, Email, Phone, Text).
Long-Term Goals:
Continuous product development.
8. STRATEGIC PLAN AND PRESENTATION - CB&I 8
Innovation of greatly improved and new energy infrastructure projects - reap initially
high profits associated with customer acceptance.
Differentiation: attributes of final product over other product qualities, and customer
loyalty.
Focus: attend to needs of domestic and global projects. Maintenance and service for
infrastructure projects.
Operational Excellence
Customer Intimacy
Product Leadership
Concentrated Growth
Market Development
Horizontal and Vertical Acquisition
Concentric Diversification
Conglomerate Diversification - NEW GRAND STRATEGY INNOVATION LONG
TERM GOAL.
Future plans for CB&I:
With the additional strategic plan of conglomerate diversification, the management team
is wanting to present to the Board and venture capitalist group a most promising investment
opportunity to increase CB&I’s stock value for shareholders, achievement of tax savings, an
increase in the efficiency and profitability of synergy between CB&I and the company or
companies acquired (Pearce & Robinson, 2013). We as Chicago Bridge & Iron’s strategic
management team have discovered that using a combination of the value disciplines, generic
and a combination of grand strategies that Chicago Bridge & Iron has in the past, concurrently,
and in the future will continue to be one of the largest energy infrastructure organizations that
shares its knowledge and expertise domestically and globally. Implementation of the new
conglomerate diversification strategy may lead to growth and expansion where previously not
considered in domestic and global markets, with a tax savings of 12-28%, a ROI of 22.17% is
calculated from accounting department and will continue to be evaluated during the
implementation of the milestone objectives.
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Strategic Plan
Chicago Bridge and Iron (CB&I) used grand strategies from the establishment of the
organization in 1889 by Horace E. Horton to the present day. These strategies have changed
throughout the 125 years that it has been in the energy infrastructure business, but it has never
lost the desire, need, or demand to not grow. Looking at these strategies can help show us how
CB&I use these strategies to grow and stay the leader in the energy infrastructure industry
(cbi.com, 2015).
Recommendations for Chicago Bridge and Iron would be along with the current
strategies of operational excellence, customer intimacy (domestic and global), product
leadership, differentiation, focus, concentrated growth of dominant product, market, and
dominant technology for the energy infrastructure products, product development, innovation,
horizontal and vertical acquisitions, concentric diversification, the addition of the grand strategy
of conglomerate diversification where acquisition of a business or competition would present the
most promising investment opportunity available for the shareholder of CB&I (Pearce &
Robinson, 2013). The potential for growth using implementation of the conglomerate
diversification grand strategy would be an 1) increase in CB&I’s stock value, 2) acquirement of
needed resources quickly (such as acquisition of fabrication shop in Beaumont, Texas, which has
deep water access to Gulf of Mexico, which increases CB&I’s capacity to fabricate and transport
large scale process modules, shop built vessels, and large steel plate subassemblies), 3)
achievement of tax savings (12-28%) if purchasing a firm that tax losses offset current or future
earnings for CB&I), 4) an increase in the efficiency and profitability of synergy between
Chicago Bridge & Iron and the company acquired (Pearce & Robinson, 2013).
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Company Background
Chicago Bridge and Iron (CB&I – NYSE) was started in 1889 by Horace E. Horton with
the startup of Bridge-Truss which then after the first 3-4 projects turned into a fabrication shop in
Washington Heights, IL (cbi.com, 2015). It turned to acquisitions, and working with the energy
infrastructure development, and when war need and demand occurred it developed what was
needed for oil, and energy for the war efforts. It continued to develop and refine its current
products of water, petroleum, oil, and natural gas storage devices, and even developed and
engineered refinement of an automatic welder which increased finished production of the storage
devices in 1959. With continued growth, and sustainability, CB& I became the leader in the
energy infrastructure domestic and global business world which continues to this very day.
Following is their mission, vision, and value statements which describe what Chicago Bridge &
Iron is all about.
CB&I’s strategic statement is stated as “CB&I is the most complete energy infrastructure
focused company in the world and a major provider of government services. With 125 years of
experience and the expertise of approximately 54,000 employees, CB&I provides reliable
solutions while maintaining a relentless focus on safety and an uncompromising standard of
quality. As one of the most complete providers of a wide range of services including design,
engineering, construction, fabrication, maintenance and environmental services, no project is too
big for CB&I. Our timely and cost-effective solutions not only satisfy our customers’ needs, but
also improve the quality of life for people around the world” (cbi.com, 2015). The mission
statement reads, “Become a preferred global supplier in our strategic markets across the full
spectrum of our services. Sustain earnings (profit) growth at levels where stakeholders view
12. STRATEGIC PLAN AND PRESENTATION - CB&I 12
CB&I as a “growth” company” (cbi.com, 2015). The value statement is “At CB&I, we conduct
business in a fair, ethical, and lawful manner worldwide, and we associate with business partners
(customers, suppliers, subcontractors, and financial institutions) that share this approach. As a
company and as individual employees, the fundamental values that we will not compromise are:
1) safety, 2) integrity, 3) excellence, 4) innovation, 5) potential, and 6) accountability. Our code
of ethics is part of our value system and we will strive to uphold the highest ethical standards in
all our worldwide operations” (cbi.com, 2015).
External and Internal Environment Scan with Trend Analysis
External and internal factors are considered along with the structure of the organization
when looking at the internal operational performance and the effects that this entails on the
competitive position and possibilities of an organization (Pearce & Robinson, 2013).
Following is an analysis that will look at the external environmental factors and the
internal strengths and weakness of Chicago Bridge & Iron, along with the trends identified. It
will look at how the external and internal factors give assessment of Chicago Bridge & Iron’s
competitive position and possibilities, and how in evaluation and analysis this plays a part in the
structure and how this affects CB&I’s operational and internal operational performance.
Most Important External Environmental Factors
The most important external environmental factors include some from each environment.
In the remote environment, the most important external factors are economic, social, political,
and technological. In the industry environment, the most important external environmental
factors are supplier power and buyer power due to the global environment that CB&I operates.
The most important external factors in the operating environment are the creditors, customers,
13. STRATEGIC PLAN AND PRESENTATION - CB&I 13
labor, and suppliers which all determine when the projects are finished and when the final
product is done in the country that initially contracts the job (Pearce & Robinson, 2013).
The economic factors concern the nature and direction of the economy in which CB& I
conduct business affairs. Social factors that affect CB& I are the values, beliefs, opinions, and
lifestyles of the firm’s countries where projects are built. The stability and direction of the
political powers in control of the countries where it operates is another factor that determines the
strategic direction of the organization. Technological advances worldwide are enabling the
remote business of CB&I to go into areas where previously it would have been hard to conduct a
project, or other infrastructure endeavors (Pearce & Robinson, 2013).
In the industry environment the most important factors were supplier power and buyer
power. Supplier power is shown to CB& I by exerting their power over the prices charged for
the steel, and supplies needed to complete the infrastructure projects. Reduction of the quality of
the goods was also seen in some of the infrastructure materials used in China for a new waterway
system (cbi.com, 2015). Buyer power was used to force down the prices charged by CB& I of
the projects bid on, demanding higher quality and more service for the projects done (Pearce &
Robinson, 2013). Bargaining power is seen much in the Middle East region of Kuwait, and in
Qatar (cbi.com). In the operating environment, the customers, creditors, suppliers, and labor all
contribute to Chicago Bridge and Iron’s success or failure. The operating environment is also
known as the competitive or task environment and comprises factors in the competitive situation
that affects CB& I’s success in acquiring needed resources or profitably marketing its goods or
services (Pearce & Robinson, 2013). We will discuss the competitive position and environment
of CB&I in a section below. The customer profiles that are the market of CB& I determine the
strategic plan so resources can be reallocated if the country has political unrest, or resources are
14. STRATEGIC PLAN AND PRESENTATION - CB&I 14
unavailable. CB& I consumer and buyer behaviors in these countries globally, and determines
the cultural factors before even beginning an infrastructure project. Creditors are used to
determine if a project will be completed due to repayment schedules of the country that needs the
infrastructure project. Suppliers that are dependable are a must for CB& I. Long term
relationships are built with these suppliers due to the type of work that Chicago Bridge and Iron
does. The labor market is another operating environment factor that is most important when
working globally with infrastructure projects. Availability, reputation, and employment rates
internationally determine what type of worker that is available with the infrastructure projects
(Pearce & Robinson, 2013).
Most Important Internal Strengths and Weaknesses
Following is the SWOT analysis for Chicago Bridge and Iron. It shows that strengths
and weaknesses of the whole organization without being cut up into pieces regionally with
different offices throughout the domestic and international world.
Strengths
125 Year History
Energy Infrastructure World-Wide
58,468 Employee Strong
Provides Reliable Solutions
Focus on Safety
Uncompromising Standard of Quality
Weaknesses
Delay in Production Time Frame
Delay of Resource Materials
Opportunities Threats
15. STRATEGIC PLAN AND PRESENTATION - CB&I 15
The most important of the strengths are 1) 125 year history, 2) energy infrastructure
world-wide that provides reliable solutions and safety, and 3) uncompromising standard of
quality of every project that CB& I constructs (cbi.com, 2015). The most important of the
weaknesses are the delay in production time schedules, and the delay of resources due to
logistical shipment, political unrest, or environmental issues.
Sources to Perform an External Environmental Analysis
The sources used for the external environmental analysis is using factors from the remote,
industry, and operating environments. In the remote environment the research proposal will
concentrate on economic factors domestic and globally, social factors domestic and globally,
direction and stability of the political environment domestic and globally, and ecological factors
that will control and monitor pollution domestic and globally. Regulatory factors will be
followed internationally with using the less cost resources for ecological factors of air, land, and
water pollution prevention (Pearce & Robinson, 2013). Technological factors will be the last to
Energy Infrastructure Globally
Cross Cultural Learning Team
Initiatives
Growth domestic and globally
Timely and Cost Effective Solutions
Global Competitors
Governmental Regulations and
Restrictions
Lack of Cultural Resources –
manpower, machinery, weather, and
environmental factors.
Civil Wars Globally
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be analyzed due to the international regulation of internet and wireless electronic data transfer to
the home offices in 5 different continents.
In the industry external environment an analysis of competition in the industry will be of
great value to CB&I. Strategy for this industry environment is finding a way of coping and using
the competition as subcontractors for the infrastructure development of the project. Assessment
of the determinants of suppliers domestic and globally with be the main emphasis for this
industrial environment (Pearce & Robinson, 2013). Also, looking at the economies of scale with
the discounted governmental regulations will be of benefit for additional projects and the
integrity of work well done.
In evaluation of the research proposal in respect to the operating environment it is found
that CB&I has the capability of acquiring the needed resources and profitably marketing its
goods and services simply in relation to what the vision statement means when it states that 1)
“we expect consistent and strong growth regardless of market cycles”, 2) “we will focus on
earnings (profit) growth as our primary measure”, and 3) “we are continuing to focus our long-
term strategy on how to best grow our business based on our core competencies” (cbi.com,
2015).
Assessment of Chicago Bridge & Iron’s Resources
Chicago Bridge and Iron has three basic resources. The tangible assets are the physical
and financial means CB&I used to provide value to its customers (Pearce & Robinson, 2013).
The total assets that was evidenced by CB&I was from the balance sheet annual report that
totaled $9,389,593. That does not include the acquisition of Shaw Industries in 2013, which
Chicago Bridge and Iron bought because of external environmental factors of modulation, and
electrical energy infrastructure (cbi.com, 2015). The intangible assets are the company
17. STRATEGIC PLAN AND PRESENTATION - CB&I 17
reputation, organizational morale with 58,468 plus employees, technical infrastructure
knowledge, patents and trademarks, and the accumulated experience of 125 years (Pearce &
Robinson, 2013). Organizational capabilities are the other resource that CB& I utilizes to a
maximum to combine assets, people, and processes of taking inputs into output of superb global
infrastructure systems (Pearce & Robinson, 2013).
The trend analysis of Chicago Bridge and Iron monitors the performance over an
extended period of time and does annual reports with all accounting statements and financial
information filed with the Security Exchange Commission Office. Key performance indicators
are evaluated 4 times per year for CB& I and this information is used to refine the business
decisions and strategies. The measurements used with Chicago Bridge and Iron are the sales, cost
of goods and inventory sitting before going to a project, overhead, cash flow, net profits, and
ratio’s that are calculated to determine if the project needs additional manpower labor, or
resource materials. Another good trend that is used at CB&I is staff turnover and injury rate
which evaluates their core competency of 125 years of service in the infrastructure industry with
safety as one of their main competencies (Queensland, 2015).
Using the trend analysis for business improvement is one of the reasons that Chicago
Bridge and Iron has survived for so long with short and long term initiatives. They use the trend
analysis to identify areas of performing well, identify underperforming issues, and the trend
analysis provides evidence for strategic management decision making for continued projection of
future infrastructure projects in areas not previously entered globally (Queensland, 2015).
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Competitive Position and Possibilities
Chicago Bridge and Iron has other competition which has been started in the early
1900’s. One is Spectra Energy, which is an infrastructure company (King, 2015), and a newer
competitor to the market is NiSource, which is separating its electric and natural gas businesses
so that it can create more value to its shareholders and value to its community and customers
(NiSource, 2015). One of the ways that I see competition position of Chicago Bridge and Iron is
that they may misread the signals that may indicate a shift in the focus of competitors in the
industry and a refinement of their present strategies or tactics to gain access to global job
projects. Another competitive mistake that may occur is the overlooking of a potential
international competitor that may have worked with CB&I in the past. Chicago Bridge and Iron
does acquire companies that exhibit a strong competition for them such as Shaw Industries in
2013 (cbi.com, 2015). CB&I does not hold any competition as far as experience and knowledge
goes because it uses the best people from diverse countries to accomplish its international and
global strategic plans. The only possibility was mentioned above which is the possible
international entry of a new competitor (Pearce & Robinson, 2013).
Current Structure of Chicago Bridge and Iron
The organizational structure of Chicago Bridge and Iron has a combination of three,
possibly four different structures. It has the traditional organizational structure with the
divisional aspect with a central corporate office located at The Hague, Netherlands. It also has a
matrix organizational structure where because of the increased diversity of the infrastructure
projects that it provides skill and resources where and when they are most needed or vital (Pearce
& Robinson, 2013). The matrix organizational structure also has a product team structure
element to it so that Chicago Bridge and Iron can strategically position its resources to important
19. STRATEGIC PLAN AND PRESENTATION - CB&I 19
projects where most needed (Pearce & Robinson, 2013). It has also started expanding its
structure into the agile virtual organization due to its acquirement of a modular organization of
Shaw Industries in 2013 (cbi.com, 2015). Due to all the regions that CB&I conducts business in
outsourcing some of the work to local areas has become the initiative.
Having a combination of these different organizational structures allows Chicago Bridge
and Iron to have the staying success of any infrastructure industry giant. As the growth into new
global markets continues with the knowledge and technological advances that 2015 holds, CB&I
can only expect that it will have advantages internally and with its organizational performance.
The new water containment system that was just built in Kuwait received an international award,
and other projects are held at high standards of safety and reliable solutions for our growing
world (cbi.com, 2015). As the market share continues to climb on the stock exchange that can
only mean a rise in salary and benefit packages for those that work hard to make sure that
Chicago Bridge and Iron stays on top of the infrastructure industry.
In conclusion of looking at the internal and external environment factors and how they
relate to the organizational structure and competitive position allows any company such as CB&I
to redefine and look at the strategic plans that they want to accomplish in the next 3-5 years.
Knowing that Chicago Bridge and Iron has stabile strengths and a competitive advantage over
the structures of other companies will ensure that the strategic plans are being followed and the
future trends that may occur will not affect it financially, structurally, or business sense wise.
20. STRATEGIC PLAN AND PRESENTATION - CB&I 20
Best Value Discipline
Chicago Bridge and Iron (CB&I) use a combination of all three of the value disciplines in
how they do business in the infrastructure industry – 1) operational excellence, 2) customer
intimacy, and 3) product leadership (Pearce & Robinson, 2013).
CB&I uses operational excellence by using technological and creative processes for
remaking the current product for the best safety energy storage devices known in today’s world
(Pearce & Robinson, 2013).
They use customer intimacy such as the development of the ornamental pineapple water
storage tank in 1959 for the statehood of Hawaii (cbi.com). CB&I continues to develop storage
and infrastructure items individualized for customer projects with what the customer needs and
desires for the best impact for all. CB&I built trust using this value discipline (Pearce &
Robinson, 2013).
Chicago Bridge and Iron (CBI) uses product leadership as another value by production of
energy infrastructure products and services for projects with awards received for many of their
storage tanks and infrastructure projects completed (cbi.com, 2015).
Best Generic Strategy
Using the best competitive advantage to compete in the marketplace, there are two of the
generic strategies that Chicago Bridge and Iron use past, present, and future. They are 1)
differentiation, and 2) focus (Pearce & Robinson, 2013).
CB&I uses differentiation to stress the attribute of the final product above the other
product qualities, and thus, CB&I creates customer loyalty with growth into the other markets
that they have previously not made infrastructure products for (Pearce & Robinson, 2013). If
one petroleum, water, or natural gas storage tank is used for storage at a commercial place of
21. STRATEGIC PLAN AND PRESENTATION - CB&I 21
business, then the competition of that industry expects to use CB&I in development of their
natural gas, water, or petroleum storage tank. This promotes growth for Chicago Bridge and
Iron.
CB&I use focus strategy as a second generic strategy. A focus strategy attempts to attend
to the needs of a particular market segment (Pearce & Robinson, 2013). Chicago Bridge and
Iron has pursued putting water, petroleum, and natural gas storage tanks in isolated geographic
areas, and even a underwater oil storage tank in Dubai in 1969 (cbi.com, 2015). This contributes
to the focus strategy because of the needs of the smaller countries being able to have storage
tanks for the safe storage of water, petroleum, oil, or natural gas.
A Combination of Grand Strategies at CB&I
A combination of grand strategies is used at Chicago Bridge and Iron. A grand strategy is
defined as “a master long-term plan that provides basic direction for major actions for achieving
long-term business objectives” (Pearce & Robinson, 2013). The grand strategies have changed
as time progresses to capture new growth and markets in areas not previously tried. Expertise is
needed in all of the projects because of the magnitude, and immensity of the projects that
Chicago Bridge and Iron design and build in the energy infrastructure industry.
In 1889, concentrated growth was the grand strategy used by Horace E. Horton when he
established Chicago Bridge and Iron in Chicago, Illinois. Also, concentrated growth continued
with the opening of the first fabrication plant in Washington Heights, IL (cbi.com, 2015). The
beginning product and service was the Pratt-Truss Bridge built in Newton, IL, in 1890. The
conditions for CB&I that favor concentrated growth is the product market was sufficiently
distinctive to dissuade competitors in adjacent product markets from trying to invade CB&I’s
segments (Pearce & Robinson, 2013). CB&I also directed its resources to the profitable growth
22. STRATEGIC PLAN AND PRESENTATION - CB&I 22
of a dominant product, market, and had a dominant technology when combined with acquisitions
of other technology companies that caused expansion into the refinement of storage tanks for the
energy infrastructure industry (Pearce & Robinson, 2013).
Another grand strategy that was used by CB&I was product development which involves
the substantial modification of existing products or creation of new but related products that can
be marketed to current customers through established channels (Pearce & Robinson, 2013). This
was seen when in 1950, CB&I introduces the automatic girth seam welder which reduced the
hours required to build a tank while improving the weld quality of the storage tank projects
(cbi.com, 2015).
Innovation was a grand strategy used many times throughout the history of Chicago
Bridge and Iron’s energy infrastructure projects. Innovation is a strategy to reap the initially high
profits associated with customer acceptance of a new or greatly improved product (Pearce &
Robinson, 2013). This happened first in 1894 with the first elevated steel plate water storage tank
that is located in Fort Dodge, IA. Then, in 1923, CB&I introduced the first floating roof tank for
oil industry to reduce the product loss and fire hazards. The roof tank remains the industry
standard for safe and economical storage of petroleum products (cbi.com, 2015). In 1923, the
first Hortonsphere Pressure Vessel was designed which is trademarked. In 1930, the first
petroleum fractionating towers were built for Standard Oil of Louisiana in Baton Rouge, LA.
These fractionating towers offer comprehensive scale of technology and Environmental
Protection Containment services for refiners worldwide. The new products and storage
capabilities continue to this day for Chicago Bridge and Iron (cbi.com, 2015).
Both horizontal and vertical acquisitions are a grand strategy that continues with CB&I
with the acquiring of: 1) Howe-Baker International, L.L.C., 2) Shaw Group (Scott, 2012), 3) Pitt-
23. STRATEGIC PLAN AND PRESENTATION - CB&I 23
Des Moines, Inc., 4) John Brown Hydrocarbons, Limited, headquartered in London, England, 5)
fabrication shop in Beaumont, TX, which has deep water access to Gulf of Mexico, 6) Lummus,
7) Catalytic Distillation Technologies (CDTECH), 8) E-gas solids gasification technology for
conversion of coal and petroleum coke into syngas (cbi.com, 2015).
Concentric Diversification was another grand strategy that is used by Chicago Bridge and
Iron. Turnaround is another grand strategy that was used in 1996 when Praxair, Inc. merged
with CBI Industries in March of 1996. Praxair assembled a new management team that was led
by Gerald M. Glenn. CB&I Company remains with the Chicago Bridge & Iron Company N.V, a
Netherlands corporation and current parent company that remains to 2015 (cbi.com, 2015).
I am unsure whether there are joint ventures, strategic alliances, or consortia found in
Chicago Bridge and Iron. Further assessment and evaluation will be needed to answer this
question.
Recommendation of Strategy to Implement for Opportunity for Growth
Recommendations for Chicago Bridge and Iron would be the grand strategy of
conglomerate diversification where acquisition of a business or competition would present the
most promising investment opportunity available (Pearce & Robinson, 2013). The potential for
growth using implementation of the conglomerate diversification would be an 1) increase in
CB& I’s stock value, 2) acquirement of needed resources quickly (such as the acquisition of
fabrication shop in Beaumont, Texas, which has deep water access to Gulf of Mexico, which
increased CB&I’s capacity to fabricate and transport large scale process modules, shop built
vessels, and large steel plate subassemblies), 3) achievement of tax savings (if purchasing a firm
that tax losses offset current or future earnings for CB&I), 4) an increase in the efficiency and
profitability of synergy between CB&I and the company acquired (Pearce & Robinson, 2013).
24. STRATEGIC PLAN AND PRESENTATION - CB&I 24
In conclusion, we have discovered that using a combination of the value disciplines,
generic strategies, and a combination of grand strategies Chicago Bridge and Iron has in the past,
concurrently, and in the future will continue to be one of the largest energy infrastructure
organizations that shares its knowledge and expertise domestically and globally. Implementation
of a different grand strategy which is may lead to growth and expansion where previously not
considered, as only time will tell once implementation initiates, starting April 30, 2015 for
implementation of the new strategic planning choice in addition to the current ones being used.
Implementation Plan
1) Major Events Milestones for Implementation of New Strategic Management
Initiative:
The following event milestones will be used for evaluation of continued implementation of new
strategic management initiative of conglomerate diversification:
Event Department
Responsible
Date Due: Responsible Person
Contact
6. Beginning of
Strategic
Management
Change
Corporate and World
Headquarters:
Administration,
Executive Board,
Board of Trustees,
Governing Board
May 1, 2015 Phillip Asherman
James Sabin
Michael Taff
7. Implementation
Internally
Operating
Department –
Domestic and Global
June 30, 2015 Phillip Asherman
Patrick Mullen
Beth Bailey
Richard E. Chandler,
Jr.
James Sabin
Michael Taff
8. Measurement of
internal acceptance
to expand
externally
Operating
Department
Every 3 months
starting May 1,
2015, August 31,
2015, December 30,
2015.
Patrick Mullen,
Richard E. Chandler,
Jr.
James Sabin,
Michael Taff
9. Assessment of
Measurement
Controls
Finance and
Operation
Departments
Quarterly starting
May 1, 2015,
August 31, 2015,
Michael Taff, James
Sabin, Patrick
Mullen, Beth Bailey,
25. STRATEGIC PLAN AND PRESENTATION - CB&I 25
December 30, 2015.
10. Completion of
Strategic
Management -
Conglomerate
Diversification
Regional and
Corporate
Headquarters,
Operating
Department
December 31, 2015 Phillip Asherman,
James Sabin, Beth
Bailey, Richard E.
Chandler, Patrick
Mullen, Daniel
McCarthy, Luke
Scorsone, E. Chip
Ray
Michael Taff
2) Event Milestones for New Storage Tank Contracted Projects:
Event Responsible Region
or Department
Date Due Contact Persons
Petroleum Storage
Tank in Dubai
Middle East Division
Corporate Operating
Office
December 31, 2016 James Sabin
Patrick Mullen
E. Chip Ray
Richard Chandler Jr.
Luke Scorsone
Daniel McCarthy
Beth Bailey
Michael Taff
Natural Gas Storage
and Piping in Arab
Emirates
Middle East Division
and Corporate
Operating Office
December 31, 2017 James Sabin
Patrick Mullen
E. Chip Ray
Richard Chandler Jr.
Luke Scorsone
Daniel McCarthy
Beth Bailey
Michael Taff
Water Storage Tank
in Egypt
Middle East Division
and Corporate
Operating Office
December 31, 2018 James Sabin
Patrick Mullen
E. Chip Ray
Richard Chandler Jr.
Luke Scorsone
Daniel McCarthy
Beth Bailey
Michael Taff
Water storage Tank in
Japan with piping
Asia Division and
Corporate Operating
December 15, 2019 James Sabin
Patrick Mullen
26. STRATEGIC PLAN AND PRESENTATION - CB&I 26
Office E. Chip Ray
Richard Chandler Jr.
Luke Scorsone
Daniel McCarthy
Beth Bailey
Michael Taff
Upkeep maintenance
and service for Japan
Water Storage
Devices
Asia Division and
Corporate Operating
Office
December 31, 2019 James Sabin
Patrick Mullen
E. Chip Ray
Richard Chandler Jr.
Luke Scorsone
Daniel McCarthy
Beth Bailey
Michael Taff
Strategy Map Implementation
President – CEO, CFO, COO, and Executive Board
Human
Resources
Purchasing Operations Production Finance Logistics Marketing R & D
Recruitment
of employees
with Team
Concept –
starting daily
April 2015
through
December 31,
1. Purchase
of
Resources-
daily starting
April 30,
2015 –
December
31, 2020.
Regulation
changes
depending on
project
culture- daily
starting on
April 30,
2015,
Daily
production
schedule –
daily
starting
April 1,
2015 –
December
Exchange
rate
changes –
daily
starting
April 1,
2015 –
December
Shipment
dates and
times –
daily
starting
April 1,
2015 –
December
Evaluation
of culture
advertise-
ments -
weekly,
monthly,
yearly.
Current
Product
Assess-
ment –
daily,
weekly,
monthly,
yearly.
27. STRATEGIC PLAN AND PRESENTATION - CB&I 27
2020. monthly
starting April
30, 2015.
31, 2020. 31, 2020. 31, 2020.
2. Benefit
Packages-
daily.
2. Purchase
of
Maintenance
items –
equipment.
2. Inventory
assessment
and data for
purchasing
department.
2.
Inventory
assessment
2. Daily
production
sales.
2.
Assessment
of ways for
efficient
travel.
2.
Magazine
and News
Article
Stories.
2.
Yearly
Convent
ions for
new
innova-
tive
techni-
ques.
3. Reward
Compensa -
tion
Packages-
monthly
starting April
30, 2015.
3. Purchase
of additional
buildings for
continued
production
growth.
Every 6
months
starting in
April 2015
3. Division
offices data
reporting –
daily with
date starting
in April 30,
2015.
3.
Employee
cross
training-
weekly
starting in
April 2015,
monthly
2015,
yearly 2015
3. Daily
inventory
counts –
starting
April 30,
2015. Send
to the
Financial
and
Operations
3.
Regulation
assessment
of transport
system-
licensing,
insurance,
weight
daily
starting
3. Introduc-
tion in New
Markets-
monthly
starting
May, 2015,
and yearly
2015-
2020.
3.
Global
Technol
ogist,
science
innovati
on, and
physics
seminars
- weekly
28. STRATEGIC PLAN AND PRESENTATION - CB&I 28
through
2020.
– 2020. office. April 1,
2015 –
December
31, 2020.
starting
May,
2015,
monthly
2015 -
2020,
and
yearly
2015 –
2020
.
4. Retirement
and Social
Security
Issues- daily
starting April
30, 2015.
4. Rentals for
space and
production
needs – 6
months to 12
month
assessment
which starts
in May,
2015.
4. Machine
maintenance-
daily starting
in April, 30,
2015, weekly
starting
April, 30,
2015,
monthly
starting April
30, 2015, and
4. Line
evaluation
and
controls –
starting
daily, April
30, 2015.
4. SEC
regulations
and audit
reports –
every 3
months
starting
April 1,
2015. The
quarterly
months will
4.
Evaluation
of air, train,
highway,
and sea
costs for
transport –
Monthly
starting on
April 30,
2015.
4.
Documen-
tary clips
and photos-
monthly
starting
April 30,
2015, and
yearly
starting
April 30,
29. STRATEGIC PLAN AND PRESENTATION - CB&I 29
yearly
starting
2015-2020.
follow like
banking
quarters. 1st
Quarter –
Jan., Feb.,
March, 2nd
Quarter –
April, May,
June, 3rd
Quarter –
July,
August,
September,
4th Quarter
– Oct.,
Nov., Dec.,
Starts April
2015-
December
31, 2020.
2015 –
December
31, 2020.
5. Employee
education and
5. Inventory
of licenses
5.
Assessment
5.
Assessment
5. Monthly
finance
5.
Monitoring
5. Consul-
tation for
30. STRATEGIC PLAN AND PRESENTATION - CB&I 30
cross-training
monthly April
30, 2015 –
December 31,
2020, and
yearly 2015 –
2020.
for
equipment-
and space-
monthly
starting April
30, 2015 –
December
31, 2020, and
yearly 2015 -
2020.
of storage
devices and
safety issues-
(QI) (OSHA)
- daily
starting April
1, 2015
through
December
31, 2015 -
2020
of
expiration
dates for
materials-
daily
starting
April 1,
2015 –
December
31, 2020.
reports and
data audits
– monthly
starting
April 1,
2015 –
through
December
31, 2020.
of daily
travel
logistical
issues –
starting
April 1,
2015 –
through
December
31, 2020.
additional
means of
Marketing
Product-
daily
starting
April 1,
2015 –
through
December
31, 2020.
6. Insurance
and safety
(OSHA) –
daily starting
April 1, 2015
– December
31, 2020.
6. Regulation
fees for
storage
facilities
monthly
starting April
1, 2015
through
December
31, 2020.
6.
Evaluation
of
marketing
response –
monthly
using
current
customers
starting
April 1,
31. STRATEGIC PLAN AND PRESENTATION - CB&I 31
2015
through
December
31, 2020.
The strategy map table above is used to direct the organization throughout the
organization to reach the goals individualized for the different departments (Kaplan and Norton,
1996). Timeframes for evaluation and completion of the goals are following the different goals
and the due date of implementation is found in the Executive Summary. Having a strategy map
using short-term objectives, functional tactics, policies that empower, and rewards that align the
manager and employee priorities with organizational objectives and shareholder value provide
very effective direction in strategy implementation (Pearce & Robinson, 2013).
The action bullets are many for a big organization such as Chicago Bridge and Iron. The
dates are listed in the tables as was requested at our last meeting. I hope that this will guide the
board and the venture capitalist in making a final decision. Next, we will discuss the control and
contingency plans.
Control Plan For Chicago Bridge and Iron
Strategic control is described as “concerned with tracking a strategy as it is being
implemented, detecting problems or changes in its underlying premises, and making necessary
adjustments” (Pearce & Robinson, 2013). Chicago Bridge and Iron uses mostly implementation
control using key strategic thrusts and milestones for the different projects globally with the
storage devices made specifically for water, petroleum, natural gas, and other energy items.
Other control measures that CB& I uses is a mixture of the other three different types which
32. STRATEGIC PLAN AND PRESENTATION - CB&I 32
include premise control, strategic surveillance at a low scale, and special alert controls due to
energy regulations on the global scale at locations where the storage devices are used (Pearce &
Robinson, 2013). CB& I bases their strategic controls on major and minor environmental and
industry variables that are affected by the global market for energy and the storage of the
petroleum, natural gas, and water (Pearce & Robinson, 2013).
Along with the implementation control measure, Chicago Bridge and Iron also uses the
balanced scorecard for measurement of: 1) learning and growth, 2) business process, 3) customer
perspective, and 4) financial perspective with resource movement if needed (Pearce & Robinson,
2013). Using this scorecard approach enables the strategy of CB& I to be linked with the
shareholder value while providing several outcomes that are measurable that guides and monitors
strategy implementation with the strategic thrusts that occur with the global energy market for
storage devices (Pearce & Robinson, 2013). All of the above mentioned are measurable and
results are reported monthly to the corporate and division Chicago Bridge and Iron offices.
Functional Tactics
In the implementation process, functional tactics that are used daily at Chicago Bridge &
Iron with the implementation of the short and long term objectives is one of specificity due to the
different cultures the projects are designed in, the logistics of moving and transporting the
finished product, and the function of the finished product. Specificity is used by CB& I due to
the clear time frame for development and assembly of the products that are bought globally for
the energy infrastructure of cities and countries, and the identification of who is responsible in
the region for who is building, transporting, and final assembly in the receiving site for these
structures (Pearce & Robinson, 2013, pages 288-289).
Resource Allocation
33. STRATEGIC PLAN AND PRESENTATION - CB&I 33
Resources are allocated to Chicago Bridge and Iron per job project MCR (Master Control
Resource) sheet. Regional offices are alerted to what resources such as equipment, licensure,
manpower, and supplies are needed daily. When logistical shipment and transport are not
available there is a delay in project completion which is electronically communicated to the
different division project work site and administration.
Required Organizational Change Management Strategies for Implementation
Managers show a commitment to innovation and change by embracing three interrelated
activities: 1) clarifying strategic intent, 2) building an organization, and 3) shaping organizational
structure so that culture will be exemplified through each employee working at CB& I and will
be evident in the work completion competitively while discussed at the tables globally and
domestically (Pearce & Robinson, 2013).
Chicago Bridge & Iron uses strategic intent which is a clear statement of where they want
to lead the company and what results they expect to achieve with printing and sending to
shareholders the annual report (Pearce & Robinson, 2013). This is also communicated internally
to employees through a monthly newsletter Email which shows which direction the company
would like to go, and how this relates to yearly work performance evaluations and compensation
with wage increase or bonuses (Pearce & Robinson, 2013).
CB& I implements building an organization into their everyday activities functionally by
building the organization and ensuring a common understanding about organizational priorities
in the monthly newsletters, clarification of responsibility among managers and organizational
divisional areas, education of leadership development as part of the weekly initiatives and
education on safety along with wage increase, opening authority to lower managers at CB& I,
and communicating the changes inside and outside the organization with its regional and global
34. STRATEGIC PLAN AND PRESENTATION - CB&I 34
customers – mostly individual countries due to the energy infrastructure business (Pearce &
Robinson, 2013). Advisory groups and research and development teams are assigned to daily
and weekly look at the existing products and projects and to creatively innovate and develop new
ways of sustaining better and bigger projects. Principles are used according to culture and
project for safety, integrity, and ethical factors environmentally and socially (Pearce &
Robinson, 2013).
Chicago Bridge and Iron shapes organizational culture by creating a passion with
employees domestically and globally (contracted workers) for the values that CB& I holds in
each and every energy project that it develops, initiates, and completes. It also looks, recruits,
develops, and retains talented operational leadership project teams. Pearce & Robinson, 2013,
states, “leaders look to managers they need to execute strategy as another source of leadership to
accept risk and cope with the complexity that change brings about” (p. 364). The culture of
Chicago Bridge and Iron means that each employee’s beliefs and values influence the opinions
and actions internally in the firm, and is shown externally in the cities and countries where the
project is built (Pearce & Robinson, 2013).
Budget, Forecasted Financials, and Break-Even Analysis
Using assumed assets, sales, and costs for implementation of the conglomerate
diversification strategy identified last week is a budget set for one petroleum storage tank project
at $8.4 billion dollars which holds 700,000 gallons of off-shore petroleum. The current market
share is $43.13 per share. Conglomerate diversification raises the market share per share to
$52.16 which is a 9.03% increase with 100 shares. In evaluation of the Price-earnings share ratio
the formula would be $52.16/$3.20 earnings per share (Parrino,2012). Projected financials for 5
years would be 3% for the first 2 years, then years 3 and 4 – 2.8%, and with the final 5 year
35. STRATEGIC PLAN AND PRESENTATION - CB&I 35
financials being at 2.2%. The simple calculation of sale of the infrastructure project assumed sale
price is $10.6 billion dollars with a liabilities cost of $8.4 billion to build as mentioned above.
The gross profit margin is calculated using the formula: sales minus cost of goods sold divided
by the sales, which is 0.21 or 21%. This amount over the next 3-5 years will continue to be
analyzed for continued growth advantages. The return on assets (ROI) for this one project is
calculated by taking the net earnings divided by total assets, which is $ 10.6/$47.8 billion dollars
(Parrino, 2012). This amount is 22.17%. This might look good for a temporary fix, but continued
analysis will need to be completed (Pearce & Robinson, 2013). A break even analysis was not
done due to individual pricing for each project that is done in different countries, cities, etc.
Key Risks with Contingency Plan
In the changing environment of working with energy infrastructure such as Chicago
Bridge and Iron key risks are monitored. When faced with concentrated growth due to the
storage containers for energy, two of the risks is economic and lack of resources to complete the
project.
Contingency plans are based on environmental, culture, and psychological behaviors that
are seen in the different areas of the world. There is always a delay with each product and
storage device, and when these contingency plans are initiated due to factors that are seen and
unseen, the customer, supplier, and project team is notified electronically so other options can be
reviewed and acted upon (Pearce & Robinson, 2013). The contingency plans are implemented
with local contractors and environmental safety officers that are appointed in the local culture
domestically and internationally. There is a contingency office director that is assigned at
Corporate Headquarters at The Hague, Netherlands.
36. STRATEGIC PLAN AND PRESENTATION - CB&I 36
The risk management plan would be technological advances throughout the project sites,
and another would be communication with logistical and transport personnel when weather
delays delivery of the needed supplies, and final completed project. Risk management would be
evaluated for need for shorter time span for regulation paperwork controls, and building
approvals at the global and domestic sites.
In conclusion, there are many factors that can affect, change, or move the implementation
plan and strategic plan for the organization. Following the strategy map, and looking at the
control measures with the functional tactics can lead to a more efficient way of teaching and
making the strategic implementation part of the everyday environment at the organization.
Chicago Bridge and Iron uses a 5 minute message at the start of each work day to inform
employees how that plan is going to go for the day, and how that will affect the final project
regionally, division, and corporate wide (cbi.com, 2015). Having a contingency plan is
important for delay of supplies, service, and employees to complete the tasks assigned and the
timeframes given for completion of each project.
A leader manager is one that can show and teach, and react to change and use that to
instruct the culture of implementation strategic management to make it understandable for a
project well done and the implementation of the new strategic planning initiative of
conglomerate diversification.
37. STRATEGIC PLAN AND PRESENTATION - CB&I 37
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